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Coffee, tea and cocoa prices could fall by more than six per cent this year according to the World Bankโ€™s Commodity Markets Outlook.

The World Bank says the three beverages are forecast to fall in price in 2017 โ€œdue to greater-than-expected supply.โ€

However it also projects that agricultural raw materials are projected to rise 4 percent.

The World Bankโ€™s Commodity Markets Outlook provides detailed market analysis for major commodity groups, including energy, metals, agriculture, precious metals, and fertilizers.

The World Bank is also forecasting higher prices for industrial commodities, principally energy and metals, in 2017 and next year.

The Commodity Markets Outlook predicts crude oil prices this year will be around $55 per barrel, increasing to an average of $60 per barrel in 2018. Rising oil prices, supported by production cutbacks by Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC states โ€œwill allow markets to gradually rebalance,โ€ the report says.

However, these oil price forecasts are subject to downside risks should the rebound in the U.S. shale oil industry be greater than expected.

Prices for energy commodities, which also include natural gas and coal, are projected to jump 26 percent this year and 8 percent in 2018.

In line with oil price forecasts, natural gas is anticipated to gain 15 percent this year, led by a jump in U.S. prices. Coal is seen climbing 6 percent in 2017, due to earlier supply restrictions in China, which consumes half the worldโ€™s coal output.

Prices for non-energy commodities, which include agriculture, fertilizers, and metals and minerals, are forecast to increase in 2017, the first rise in five years. Metals prices are projected to jump 16 percent this year due to strong demand, especially from China.

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Source: Daily Nation

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